Barack Obama has threatened to use his inauguration speech in January to heap
blame on the Republicans for forcing the United States over the so-called
'fiscal cliff' if they failed to reach a deal before the New Year, it was
reported on Sunday.

Mr Obama has threatened to shame the Republicans in his inaugural address on January 21Photo: JEWEL SAMAD/AFP/Getty Images

The threat came as the Republican party's negotiating position was left badly weakened by the failure of its lead negotiator, the House speaker John Boehner, to win support from his party rank-and-file for a 'Plan B' that would have raised taxes on those earning $1m a year.

The two parties remain bitterly divided over how to rein in America's trillion-dollar-a-year annual deficits, with Republicans demanding fundamental cuts to welfare programmes and Democrats arguing for tax-rate rises on the wealthy.

Despite both sides giving some ground, negotiations between Mr Obama and Mr Boehner since the election have failed to close the gap, increasing the likelihood that America will go over 'the cliff', triggering some $680bn in automatic spending cuts and tax hikes.

The threat by Mr Obama to shame the Republicans in his inaugural address on January 21 – reported by the Wall Street Journal – reflects the president's determination to appeal to broader public opinion which polls show favours his plan to force through tax rises on the wealthy.

Although both sides have compromised – Mr Obama cutting his demand for additional tax revenues from $1.6tr to $1.2tr and Mr Boehner agreeing to break the Republican taboo on raising marginal tax rates – the closed-door negotiations have been testy.

"I put $800 billion [in additional tax revenues] on the table. What do I get for that?", asked Mr Boehner, according to sources quoted by the Wall Street Journal, "You get nothing," replied the president, "I get that for free."

In another meeting, the president reportedly repeatedly reminded Mr Boehner of the election result and the mandate he believes it gives him to raise taxes on those earning over $400,000 a year: "You're asking me to accept Mitt Romney's tax plan," Mr Obama is reported to have asked, "Why would I do that?"

Congress is now on holiday until December 27, when members will return to discuss how to avoid going 'over the cliff' on December 31, an event that would raise taxes on all American, potentially spooking financial markets and driving the country back into recession.

Mr Obama went for his break to Hawaii, boarding Air Force One with his wife Michelle, daughters Malia and Sasha and Bo the First Dog. He was spotted going to play golf with friends and dining at the upscale Morimoto Restaurant in Waikiki.

Before leaving for his break, Mr Obama suggested Congress could pass a more limited, short-term deal – to at least avoid tax raises – but as discussions continued in Washington over the weekend, that prospect appeared to be receding.

Delivering the Republican Party weekly address, Mr Boehner repeated his calls for Mr Obama to offer substantial, long term reform to America's spiralling welfare bills in order to clinch a deal.

"What the president has offered so far simply won't do anything to solve our spending problem and begin to address our nation's crippling debt," he said.

"The president's solution of raising tax rates would still leave red ink as far as the eye can see. And it would hurt jobs at a time when far too many of our citizens are struggling to find them."